Shanghai worries about real estate bubble
Research by the Shanghai Academy of Social Sciences says investment in real estate increased by more than 50% in the first six months of this year but most of the newly-built houses and buildings were expensive. Although expensive houses sold well in the first half year, only 30% of the buyers were local residents. The report also showed that about 20% of people bought a house as an investment instead of a residence; some bought more than one apartment but most of the money came from loans. As real estate companies from around the country rush to the city, land prices were being pushed higher. (People's Daily, 18 August)

UBS pact to open Guotai equity door
UBS Global Asset Management signed a memorandum of understanding with Guotai Asset Management, which will allow UBS to explore possible acquisition of an equity interest in the mainland partner. UBS Asset Management is part of Swiss UBS which has CHF 2.5 trillion worth of assets under management and is one of the world's largest asset management groups. According to rules effective from July 1, foreign firms can enter China's fund market by taking up to 33% in a new or existing fund management company, rising to 49% after three years. (SCMP, 19 August)

ASEAN, China inch closer to economic cooperation pact
Trade negotiators from ASEAN and China are near to concluding an initial trade liberalization package to be executed prior to an agreement on a ASEAN-China Free Trade Area (FTA). A framework agreement on economic cooperation between ASEAN and China may be submitted, along with an ''early harvest'' package, to ASEAN and Chinese economic ministers for initial approval when they meet on Sept. 13 in Brunei. (Kyodo, 19 August)

Fishing fleet stranded by deal
Thousands of Chinese fishing boats have been stranded by the implementation of the international fishing pacts signed between China and its neighbours Japan, the Republic of Korea and Viet Nam. Government chiefs have pledged to allocate RMB 270 million a year to remove the boats from the country's fishing fleet and transfer at least 300'000 affected fishermen to other jobs. (China Daily, 19 August)

China seen as threat to Japan carmakers
China could in the near future become a car-manufacturing giant, and Japanese carmakers should keep their manufacturing technologies close to their chests to prevent them leaking to China, Japan's Economy, Trade and Industry Ministry said. A report compiled by the ministry said it would take China considerably longer to become a major exporter of vehicles. China's dependence on imported high-tech materials has prevented it from transferring low labor costs into low prices for car parts. (Yomiuri Shimbun, 19 August)

China ranks as world's No. 1 in washing-machine output
China's 2001 annual output of washing machines has reached nearly 15 million, ranking first in the world. Chinese washing machines are mainly low-end or medium-end ones. Along with the country's continued economic development, especially the activation of the rural market and the development of western China, there will be more room for the growth of washing-machine manufacturing. (ChinaOnline, 20 August)

China hotel market to lead Asia growth
A recent survey of the world's 1'800 largest investors and owners of hotel or resort properties pointed to an upturn in trading performance in the Asia Pacific hotel market following last year's downturn. China would show the fastest growth, helped by its entry into the WTO and its successful bid for the 2008 Olympic Games, the report said. Investors believe the hotel industry in China will benefit from the increasingly affluent domestic population as well as the influx of foreign corporate travelers. (The Standard, 20 August)

Weak dollar fuels Chinese economy
Uncertainties in the US economy, the country's huge fiscal and trade deficits and numerous firms' accounting scandals in recent weeks have caused the US dollar to slip against the euro and Japanese yen. The US dollar's devaluation is expected to result in increased foreign trade for China, and US investment in China. The slipping US dollar will also help China upgrade its export composition and sharpen trade competitiveness. (Business Weekly, 20 August)

Shanghai JV to churn out light choppers
Shanghai Sikorsky Aircraft Corp. had its business licence approved and is to start production possibly in September. The helicopters will be sold to qualified organizations and individuals. (China Daily, 21 August)

Foreign chain stores told to keep stakes under 65p%
The Chinese government has ordered foreign partners in joint- venture retail chains to sell any shares they hold beyond the 65% limit. Foreign retailers are required to operate through joint ventures with Chinese partners. Under China's WTO commitments, restrictions on the retail and service sectors will be gradually lifted over the next five years. Analysts believe the present action would help domestic players prepare for cutthroat international competition. (SCMP, 21 August)

New Forex rules debut
The State Administration of Foreign Exchange said enterprises within China's bonded areas needed to observe a new set of foreign exchange management regulations. According to the new rules, both foreign and domestic enterprises in trade zones have to register with SAFE to get forex registration certificates, an identification which allows those enterprises to conduct foreign exchange-related activities. SAFE will abandon foreign-investment enterprise registration certificates, formerly issued only to foreign enterprises. (China Daily, 22 August)

China to promote key food processing industries
The processing of beans, corn, potatoes, milk and meat are among a dozen of key food-processing industries that China will work hard to promote over the next five years. The key food-processing industries will also include sugar refinement, storage and transport, beverage, convenience food, aquatic product processing and package machine building. (People's Daily, 22 August)

More bank graft
A China Construction Bank employee stole RMB 21 million from his branch and gambled it all away. The loan officer at a branch in Yiwu city in Zhejiang province, set up a fake company with his brother and then lent it money. (FEER, 22 August)

Stock borkerage closed for misconduct
As part of a drive to clean up China's stockmarkets, authorities for the first time ordered one of the country's 120 brokerages to be closed for misconduct. Anshan Securities, based in the northeastern province of Liaoning, was be liquidated by the central bank for irregularities. (FEER, 22 August)

Shenzhen overtakes Guangzhou
The city of Shenzhen has overtaken the provincial capital of Guangzhou in sales of manufactured goods. In the first half of this year sales of products manufactured in Shenzhen reached RMB 153.653 billion compared with Guangzhou's RMB 139.118 billion. Shenzhen's industrial production rose 17.4% year on year to RMB 288.044 billion in 2001 over Guangzhou's output of RMB 282.2 billion. (FEER, 22 August)

Toshiba to build World's largest laptop factory in China
Toshiba of Japan recently laid the foundations for the world's largest notebook computer production base in Hangzhou, Zhejiang Province. The project is expected to be completed by next April. In the first year, it will manufacture 750'000 laptops, and by 2004, the output will be increased to 2.4 million. (People's Daily, 23 August)

China allows mainland invest in Red Chips, H-Shares
China issued new foreign exchange rules which will create a register of all domestic shareholders in red chips and H shares. The move is a first step towards the introduction of a long-awaited Qualified Domestic Institutional Investor system which would allow mainland investors to acquire shares in offshore-listed Chinese companies. China has more than USD 135 billion in foreign exchange held by companies and individuals which is mainly held in savings deposits. Creating a QDII scheme would allow some of that liquidity to flow across the border to help boost Chinese-listed companies, particularly in Hong Kong. (Dow Jones Newswires, 23 August)

Personalized license plates spark debate
Hot debate and speculation spread among citizens of four major Chinese cities when it was announced that a personalized licence plate pilot project would be shut down after only 10 days. Although the traffic authorities did not give a clear explanation as to why the trial came to a sudden halt, some suspect that the creative use of licence numbers and the chaos it could cause might be part of the reason. Since car owners were free to choose any sequence or combination of letters and numbers (except CHN), many people were reported choosing plates like BTV-001, SEX-001, USA-911, IBM-001, WTO-001 and so on. (China Daily, 23 August)

7-Eleven to open 500 stores in Beijing
U.S.-based convenience store chain 7-Eleven Inc. plans to open 500 stores in Beijing within five years. 7-Eleven has chosen 7-Eleven Japan and Taiwan Uni-President Enterprise for its expansion to Beijing. A Chinese partner would be chosen to form a joint venture with the two companies to operate the Beijing stores. Currently Guangdong province is the only region in China that has 7-Eleven stores. (ChinaOnline, 23 August)